27 Customer Retention Strategies that Work

by Daniel Hannig

“The best way to hold customers is to constantly figure out how to give them more for less.”

Philip Kotler

Investing in customer retention pays off. Credible organizations like Harvard Business Review, Bain and Company, and Forrester have been urging companies to prioritize their retention efforts for years. However, a customer retention program is no easy task. Keeping both your boss and employees happy is a difficult job, but not impossible!

According to a study made by the Harvard Business School, it was found that increasing customer retention by even 5% can increase profits between 25-95%.

A classic mistake made by small and medium entrepreneurs is to assume that more customers mean more business.

What can we do to improve customer retention? If you want to build a thriving and successful business, you need to take care of your customers – the backbone of any company.

Let’s take into account that some tactical errors like not measuring customer satisfaction or focusing on offering discounts are given more attention, time and money than the attraction of customers and their retention.

First things first, what is customer retention?

Customer retention is the ability of a business to retain customers and measure both, customer loyalty and the capacity of the business to keep customers satisfied by good service and quality of the product that is being sold. Customer retention is a simple concept – happy customers are most likely to come back if they are being communicated to in the right way.

How to improve your customer retention strategies?

There are three broad types of customers: loyal customers, fair-weather customers, and first timers.

Clear and straightforward customer retention strategies will help you lower churn rate, increase company revenue and increase profitability.

For your customer retention strategy to work, you need to make them part of your daily routine. In order to help you increase your retention rates, we have collected a list of our 27 favorite customer retention strategies to help you and your company improve!

1. Analyze the different types of customers

Understanding the different customer segments that make up your customer database is very important. It’s best that you separate them into segments such as loyal customers, low-performing customers, and non-active customers, among others.

Once you have your clients divided into different groups, you can dig even deeper to understand their needs by the type of industry or business. This will allow you to adjust to their offers so that they find them appealing.

In addition, this will also provide your sales and customer service representatives with the specific data and examples they can use to explain how your products and services can meet the needs of the industry and individual customers.

2. Measure service performance

This is a key strategy you’ll need to ensure that your customers receive the level and quality of service they are entitled to receive. In addition, this helps ensure that everyone in the company is informed until which extent those objectives are being met or not.

This doesn’t only mean the measurement of specific numbers, but also the measurement of perceptions that the customers have about the quality of the service. This is certainly difficult and cannot satisfy every customer every time, but it is in the pursuit of excellence where we see an improvement in customer perceptions.

3. Meet your commitments, both implicit and explicit

There are a number of things that customers can forgive but never forget. What they will always remember, and will make them seek another company to meet their needs is a company that does not keep its promises.

You should always be very clear about your promises and when and how you’ll be able to accomplish them. Make sure you do it in a timely manner. Don’t forget to contact the client to confirm and thank them for their business.

4. Encourage customer participation

Getting customers involved often means nothing more than getting customers to commission more jobs. This usually creates economic savings that they share with clients and provide an incentive to maintain the relationship. If there’s a comfortable relationship between clients, it usually remains the same.

But if a client makes a bigger investment in the company, the relationship is usually safe for a considerable period of time.

Emotionally, clients are often highly motivated to participate in the customer service process and are usually identified closely with suppliers in “partner” agreements. This tends to increase the probability of customer retention.

5. Create a disaster recovery plan

Why is having a disaster recovery plan important when retaining customers? The answer is very simple. The longer the delivery time, the more money it costs you and the more frustrated your customers will feel because they will not be able to use the contracted product or service they inquired.

While your customers have the option of sharing their experiences on social networks, you have to be prepared for everything from good to bad reviews.

How you handle it will either be what saves or what will hurt your reputation. Knowing how to properly address problems will make your clients see that you are doing everything possible to fix and satisfy them and that you are interested in having positive experiences, for this reason, it’s very important to develop a plan that will help manage possible digital crises. Even before they happen.

Customers want a reliable product and/or service and want to be able to contact you whenever they need help. If you can not afford them, they will look somewhere else.

6. Try to have quick response times

One of the most important aspects when it comes to retaining customers is to offer a fast and satisfactory solution to accustomed complaints and requests. Customers want to be taken care of quickly and solve problems in a timely manner. Customers are more likely to remember how you handle a topic than the question itself.

7. Offer a unique feature service

Why invest in offering unique features? Two words: competitive advantage. If you offer products and services that your competitors do not, your customers have nowhere else to go to get what they need. Make it work and strive to become a “one-stop shop” by adding new products and services when the demand is high and improving (simultaneously) your existing products and services.

8. Empower customer service staff

Agents who have been trained in capturing customer feedback can detect customers who are not satisfied or are considering buying from the competition and can pass that information to the company. They must also be trained to pass on the competitive information so that the marketing department can take the appropriate approach.

Instructing them on basic customer retention techniques gives them the tools they need to keep customers. This is achieved by properly responding to complaints, making dissatisfied customers pleased and loyal, and educating customers about the value of your company’s products and services.

Train customer service personnel so they are familiar with systems, policies, and procedures and give them a thorough knowledge of the product and service; it prepares them to handle customer calls professionally and proactively in a way that ensures customer satisfaction.

9. Automate the lower end, customize the upper ends

Customer retention is more than giving the customer what they expect; it is about exceeding their expectations so that they become loyal advocates of the brand. Creating customer loyalty prioritizes customer value rather than maximizing profits and shareholder value as the center of business strategy.

This strategy is important when retaining customers by allowing you to automate the routine tasks that sales, customer service, and marketing carry out every day, thus freeing up valuable time that can be used to call customers.

10. Know your customers

Even the best companies lose clients.

To prevent churn, it is important to know your client’s business. Be a consultant and ask your clients questions. This will allow you to guide your customers to buy what they really need, not what they think they want. In addition:

  • Be proactive in your customer service.
  • Create an overview of customers that called into your office with questions or complaints.
  • Create an overview of customers with disrupted buying pattern.

11. Track missed deals and canceled orders

Keep track of loss of income and try to see how to reverse cancellations right away. Do not hesitate or be afraid to ask customers why they canceled an order or why they took their business elsewhere. By obtaining this valuable information, you will be able to identify the necessary steps to recover the loss of business and/or avoid the same mistake from happening in the future.

The Luxury Client Experience Board found out that every time a customer returns, they are more likely to buy from you again. Your customer has a 27% chance of returning to your business after their first purchase.

Coming back for the second, third and fourth time, the percentage increases significantly. By the third time, if a customer returns and makes a purchase from you, there’s a 54% chance of them making another fourth purchase.

12. Provide incentives for clients

If your clients continue doing business with you offer them incentives.

Price is always a concern for people when it comes to buying a particular product or service. What you don’t want to do is enter into a price war with your competition. Implement a pricing strategy in which you’re not the cheapest nor the most expensive.

At the same time, do not offer discounts to all customers by the mere fact of offering discounts, rather offer your customers to look for discounts or vouchers from your company before placing an order.

Act more “scientifically.” Implement prediction models in order to make the right offer to the right customer at the right time. An all general-offer does not serve all customers.

13. Develop personal relationships

One simple thing to consider is the assignment of an individual person to certain accounts and the empowerment of this person to build a relationship with each client. It’s necessary to implement activities for customer loyalty when developing personal relationships. Building customer relationships improve customer service, therefore:

  • Learn about your customer
  • LIVE for customer complaints
  • Stay in regular contact with customers
  • Build trust with customers
  • Practice inbound marketing

“Make a customer, not a sale.” —Shep Hyken, customer service expert, and bestselling author.

14. Advertise to keep customers, as well as acquire new ones

Advertising allows you to effectively measure your marketing strategies and conversion rates. According to rjmetics.com, only 32% of customers actually order second time over the course of the first year. That is, most of the acquired users used to drop off after the first sale.

Remind customers of all the product and/or service’s features or applications that improve utility and satisfaction. Use surveys to measure the effectiveness of advertising campaigns you try and ensnare your BFF customers.

15. Track new customers

This tactic is very easy to apply online and is a golden strategy that all companies should strive to achieve, but especially important for e-commerce companies. Tracking new customers provides a human touch in an impersonal transaction, thus creating the basis for a loyal relationship.

16. Win back lost customers

To quote E.B. White: “A mistake is simply another way of doing things.”

When trying to win back a customer, it is okay to make mistakes. Remember that the customer is already lost. And you only have a 20-40% chance of success to sell to a former customer according to the book Customer Winback: How to Recapture Lost Customers – And Keep Them Loyal.

The chances of success to sell to a potential customer is only 5-20%.

Research done by Marketing professor V. Kumar from the University of Georgia State suggests there are three simple reasons on why you should focus on winning back lost customers:

  • Lost customers show they need your product or service.
  • Lost customers are already familiar with your brand and service. You’ll spend less time educating them about your product.
  • Today’s technology allows you to keep track how many people have used your product or service. With this information, you can determine which customers to approach and create tailor-made offers to win them back.

It’s easy to get a general overview of the customers you should focus on and start thinking about the different win-back strategies you can use.

17. Improve customer experience

It always helps to enhance a great customer experience, build customer loyalty and improve sales.

How can you keep buyers engaged? How can you anticipate their needs?

Improving customer experience involves making sure your customers receive the best possible service. And customer service includes all the interactions before, during, and after the purchase.

Replying emails three weeks late or being rude to a customer who has a question is to give poor-quality service to your buyers and that’s simply unacceptable.

Customers don’t have tolerance for lackluster service.

Studies show that 47% of customers would take their business to a competitor within a day of experiencing poor customer service. That same generic email won’t work. It’s all about giving your customers something extra.

Don’t wait to build relationships with your customers. Strive to customize the bond right from the beginning.

18. Learn from customer complaints

Check-in with your customers to make sure they have what they need to do their job successfully. Giving your employees the right resources (whether it’s training, equipment, etc.) it helps improve their ability to provide customers with the services they expect.

19. Create customer surveys / follow up programs

Listen to your customers by conducting customer satisfaction surveys. According to Econsultancy, 82% of companies agree that customer retention is cheaper than terminating a relationship with a new customer.

20. Use social media outlets

Believe it or not, research shows the phone is still the preferred method of customer service contact. When the client acquires products and services on an emotional rather than the scientific basis, at least in most cases, an emotional involvement is the motorizing factor in the acquisition or not of a product or service.

If a sales representative addresses names and phone numbers (your extension number, for example), you would be customizing the business relationship and that’s highly appreciated by the customer.

However, social media is also an effective way to reach your consumers. Customers are currently active on Twitter, Facebook, and other social networks but many organizations are mainly using social media sites, such as Facebook and Twitter, to reel in new customers. As a second step, they are using these social media sites to create a relationship between customers, to convert their new clients into loyal customers.

Your team should be available online to respond to complaints and broadcast announcements.

  • Make a showcase of your product
  • Show your audience a story worth remembering
  • Create short “how-to” articles


LinkedIn is so much more than a house for your resume. Using LinkedIn can have a substantial impact on your marketing campaigns and should be a significant part of your customer retention strategies (depending on the business)


Follow your audience on Twitter and engage in conversations with them. Your goal and aim should be to provide as much help as possible.

Showing that you care and want to make sure everything is taken care of is going that extra mile. Don’t forget to address your customers as well.


Facebook is a built community of engaged customers. 82% of the Facebook audiences would prefer to watch a live broadcast than reading a blog post. Facebook Live broadcasts become a powerful retention tool to share your brand’s expertise and promote special offers. You’ll want to master all the nuances of live broadcasting:

Announce an upcoming event

To build trust and strengthen relationships, ignite interest in the audience you’re targeting with your event. Facebook Live lets you target a particular group of similar interests.

21. Create surveys

Provide timely updates and work progress reports. Request feedback on performance through customer service surveys or phone calls. Your client will feel valued when you seek their opinion. Advise them on new offers, upgrades, or product/service enhancements that create a better customer experience. Find ways to say “Thank you” on a regular basis.

A good way to communicate regularly is to start sending a regular newsletter.

21. Snail Mail

Though it can be tempting to become complacent with high sales, keeping in touch with customers is a major step in nurturing a long-term relationship. Whether it’s via snail mail coupons or fliers, staying in touch with your customers before and after they visit your business is crucial. Think of it as dating. You’re not just going to say goodbye at the end of a good night and not send a reach out text the next day or next rendezvous. The final outcome won’t be ideal then.

22. Focus on exceeding your customer’s expectations

A 2013 Accenture report on the impact of customer service reveals that 66% of consumers switch to competition because of poor service to them. But in addition, 81% say that the company could have avoided this situation.

Hard to believe, isn’t it? It’s not the only data found in this matter. For example, data collected by a Forbes survey shows that 86% of customers would be willing to pay more money to get a better service and feel more valued as a consumer.

For this reason, it is why employees in charge of giving comments or opinions of consumers who show that they are unhappy must act fast! Or they will go with the competition. Train them on customer retention techniques so that their experience is satisfactory.

Tools like HootSuite or UserVoice will allow you to manage the social networks of your company and know what users think about your brand.

23. The Powerful Worth of Mouth

Seek out to invite others to make purchases in your business. You will be saving costs of advertising and acquiring new products, leaving this difficult task to word of mouth advertising.

At this point, you should consider all the methods your clients could take to communicate with other potential customers. From your social networks to the blog of your online store, there must be a space where the customer can share their positive experience they lived up to the company and explain why they would return once again to spend money on it.

Another option you can use is to create a section of recommendations, success stories or testimonials. In it, you can select distinguished customers who share more extensively the benefits they have gained by consuming your products and why they believe you are the buying option that people are looking for.

24. Surprise your customers

Always offer new things but most importantly, give them something they can and want to remember. Of course, visual elements like the logo, name and slogan count, but a memorable shopping experience makes them not only remember what they acquired; with it, they remember how they felt when they bought your brand.

If you tried hard and offered them an experience that made them feel valuable, they will surely come back.

Launches of new products/services to market will make the customer come back over and over to see what’s new.

25. Improve KPI’s around your customer service

The Key Performance Indicators are a series of metrics that are used to have a better knowledge of the productivity of actions that we’re doing, in order to measure, compare and decide what type of actions are best for the fixed goals.

The main objective of these quality indicators is to help us make productive decisions.

In order to properly target objectives, the SMART methodology is usually used; that is, the objectives have to be specific, quantifiable, realistic and coherent. All of this takes time to implement. As an addition to this methodology, it’s also of your best interest to assign each objective to the corresponding person or department.

As common objectives, we would have: achieve growth sales, increase market share, decrease spending, improve brand image, improve web page performance, increase traffic for new users, etc.

The KPIs help us attract and retain customers, as well as to promote the products or services of a company:

  • Email Marketing: number of people who open their email, number of people who click on that email, conversion rate, service drops.
  • Content Marketing: number of shares on Twitter or Facebook, number of comments in those publications, number of people who bought a product thanks to the content in the blog, records in the newsletter.
  • Marketing Analytics: number of users adding a product to the shopping cart, conversion rate, most visited product categories, rebound percentage, page views.
  • Brand Marketing: number of positive mentions of our brand or reviews, number of people who bought a product thanks to the content in the blog.
  • Sales: Cost of acquisition of new customers, purchase cross products, qualified leads.

26. Provide Security

All risk factors are involved in all purchases. The two most common ones are functional and financial. The functional risk happens when the product or service does not function as it should. The financial risk happens when paying more for something that is worth less.

One way to ensure your customers always stay with you is to minimize those risks. Offer honest and generous guarantees when a malfunction occurs. Set policies by which you would equalize the price or even make an additional discount if the customer finds the same product cheaper elsewhere. And most importantly, communicate the guarantees and comply with them.

27. Analyze your competition

Yes, customer focus is critical, and don’t forget that there will always be someone else trying to get your attention. Do you know what strategies the competition uses to attract your customers or why they try them?

Analyze your tactics, add more attractive offers and act accordingly to the results you get. Tools like SEMrush or Woorank will help you to deepen the actions that your competitors develop. And a good analysis can push you to also capture the competition’s customers with an appropriate customer retention marketing strategy.


There are many tactics to tackle customer retention but no shortcuts. We hope our reflections made it clear that appropriate customer retention strategies should be implemented and carried out with special empathy towards the customer’s persona.

Customer retention doesn’t only mean loyalty but also recommendation, which translates into an increase in the value of an existing customer that sooner or later will result in the arrival of new customers and there is no better advertising for a company than the satisfaction of its customers. In addition, we should never underestimate word of mouth when designing customer retention strategies. This is a multiplier effect provided by customer referrals that can be of great help when increasing long-term sales. Over time, part of this new clientele will also be a part of the regular customers, and with WOM, it will help get an additional value, fueling a positive dynamic that will translate into a virtuous circle of loyalty and trust.

Keeping a client under the prism of a revaluation process involves not only understanding the advantages of lower costs compared to the acquisition of a new customer, but also the more than likely discredit our product and company will suffer in the medium term.

For any business, customers are their greatest asset. Growing in the market is important, but an efficient and well-developed customer retention strategy involves lower cost drains and greater corporate prestige. A customer retention strategy is crucial, due to the existence of an increasing ROI as well as lifetime value of customers. Remember that just because someone is a customer, doesn’t mean you should stop engaging with them. There is still a lot we can do to help improve employee engagement and customer retention strategies for the years to come!

Which of these customer retention strategies would you implement in your team? Are there other examples we missed? Share your perspective in the comment section below!


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